Cape County Commission examines changing tax rate for disabilities board

An upcoming opportunity for the county to revise tax levy rates which fund several county boards has spurred discussion among its commissioners regarding the Cape County Board for Developmental Disabilities and its pending lawsuits with VIP Industries, as well as the board's accountability for expanding services.

Commissioners vote on revisions of the tax rates annually. This year, at least two commissioners are considering a vote to change the 2011 rate to zero for the disabilities board in light of the lawsuits and unspecified plans for expanding services.

During Monday's regular commission meeting, disabilities board chairman Larry Tidd requested the continuance of tax rate of a 0.0770 cents per $100 assessed valuation that funds the activities of the board, saying that would allow for expansion of services to disabled people in the county and prevent a negative reserve fund balance in the case the board lost or settled a lawsuit with VIP Industries.

Presiding Commissioner Clint Tracy made a motion to make the tax rate zero. He and Commissioner Paul Koeper voted in favor; Commissioner Jay Purcell voted against it. The final rate will not be set until after a public hearing is held at 9:15 a.m. Sept. 8 in the meeting chambers of the county commission.

According to Tidd, the board has around $3.7 million, $2 million of which has been accumulated over the past 20 years. The board was created by a 1969 law and collects about $870,000 a year in property taxes and spends it through its contracts with VIP to provide sheltered workshops for disabled people in the county. In the past several years, the board has paid between $400,000 and $600,000 to VIP, with the exception of the past year, when the board stopped paying over a dispute between the two entities.

"If this lawsuit is settled on a short-term basis, the better part of the undesignated part of the budget will be substantially pulled down because we're already a full year past," Tidd said.

He said if the dispute is settled by VIP winning a lawsuit, then around $1.2 million could possibly be paid out.

VIP filed a lawsuit against the board in February, claiming it is owed for unpaid insurance, maintenance and other costs related to operating the sheltered workshop that employs developmentally disabled workers.

The board filed a countersuit against VIP in July, requesting the dismissal of the lawsuit and asking for the release of VIP's accounting records, relinquishment of property housing the sheltered workshops, payment of rent allegedly owed since the end of the last contract, an award of more than $1.5 million for money that VIP was allegedly reimbursed for ancillary items and an award of the value of any financial gain VIP may have made from board-funded reimbursements associated with training, teaching, activities, and workshop or residential facilities.

Koeper raised concerns about the amount of money the board has and its plans for it. He questioned whether it was necessary for the county taxpayers to keep paying in if the board wasn't going to expand services soon and was possibly going to use a large amount of the money to pay a settlement to VIP.

"I am all for taking care of the handicapped -- that's the reason the tax was voted in -- but I don't think the citizens are looking for somebody just to keep taking their money and putting it away," he said.

Tidd responded that only one-third of the disabled people within county are being served by the board.

"The workings of this board are to expand our services to include a greater quantity of the developmentally disabled," he said. "It is our intent to try to expand that service, and it's going to cost money."

Purcell said he thought it was unfair to hold the reserves against the board.

"I think the issue at hand is not whether you would lower this tax rate, it's more about putting in place a process that leverages those taxes to be used to benefit the most possible citizens that it can," he said.

Tracy said it was the responsibility of the commission to be accountable to taxpayers.

"Right now they are paying money in and we're talking about expanding services, but we're not doing it yet," he said. "I'm pretty sure that nobody thinks that these funds should go to fund attorney's fees."

Tracy said if the tax rate were to be rolled back for a year, it might provide some opportunities for the board and VIP to get together and negotiate. Koeper said with the loss of one year's income, the board could still provide services to the disabled.

Purcell said a decision to lower taxes to try to prompt some kind of settlement would be inappropriate.

Tracy made a motion to make the tax rate zero. He and Koeper voted in favor; Purcell voted against it. The final rate will not be set until after a public hearing is held at 9:15 a.m. Sept. 8 in the meeting chambers of the county commission.

eragan@semissourian.com

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